Heads roll at Citigroup over fraud in Mexico

Citigroup has taken $235 million in charges tied to fraud at its Mexican subsidiary Banamex.

Citigroup (C) has axed another 11 employees over the embarrassing and costly fraud unearthed at the bank's Mexican subsidiary Banamex.

The terminations include four managing directors, two of whom are business heads in Mexico, Citi said in an internal memo to employees Wednesday.

Citi said its ongoing investigation has identified additional employees who could be at fault and expects that several will receive disciplinary action. The bank previously announced the firing of one individual related to the fraud.

"The financial impact of this fraud has been significant," Citi CEO Michael Corbat said in the memo, but the "impact to our credibility is harder to calculate."

The New York bank already took a $235 million loss from the loan fraud, which involved misappropriated funds to Banamex client Oceanografia, a Mexican oil services company that had been a key supplier to state-owned oil company Pemex.

Citi said it continues to believe this was an "isolated incident," though it is reviewing its controls and processes in Mexico and cooperating with regulators and authorities. U.S. authorities are probing Citi and Banamex's anti-money laundering controls.

Despite the recent turmoil, Corbat said Banamex, which Citi acquired in 2001 for about $12.5 billion, remains an "integral part of our global network and a source of great pride for our franchise."

It's been a difficult few months for Citi, America's third largest bank, which in March was dealt a blow by the Federal Reserve rejecting the bank's dividend and share repurchase plans.

Matt Egan is a staff writer for CNNMoney’s markets and investing section. He covers Wall Street, hedge funds, geopolitics, emerging markets, M&A moves and cyber security. He previously worked as a senior reporter at FOXBusiness.com. Follow him on Twitter @MattMEgan5